ECHELON; WORLDWIDE CONVERSATIONS BEING RECEIVED BY THE ECHELON SYSTEM MAY FALL INTO THE WRONG HANDS AND INNOCENT PEOPLE MAY BE TAGGED AS SPIES

STEVE KROFT, co-host:

If you made a phone call today or sent an e-mail to a friend, there's a good chance what you said or wrote was captured and screened by the country's largest intelligence agency. The top-secret Global Surveillance Network is called Echelon, and it's run by the National Security Agency and four English-speaking allies: Canada, Great Britain, Australia and New Zealand.

The mission is to eavesdrop on enemies of the state: foreign countries, terrorist groups and drug cartels. But in the process, Echelon's computers capture virtually every electronic conversation around the world.

How does it work, and what happens to all the information that's gathered? A lot of people have begun to ask that question, and some suspect that the information is being used for more than just catching bad guys.

KROFT: (Voiceover) We can't see them, but the air around us is filled with invisible electronic signals, everything from cell phone conversations to fax transmissions to ATM transfers. What most people don't realize is that virtually every signal radiated across the electromagnetic spectrum is being collected and analyzed.

KROFT: (Voiceover) Mike Frost spent 20 years as a spy for the CSE, the Canadian equivalent of the National Security Agency, and he is the only high-ranking former intelligence agent to speak publicly about the Echelon program. Frost even showed us one of the installations where he says operators can listen in to just about anything.

KROFT: (Voiceover) This listening post outside Ottawa is just part of a network of spy stations, which are hidden in the hills of West Virginia, in remote parts of Washington state, even in plain view among the sheep pastures of Europe.

This is Menwith Hill Station in the Yorkshire countryside of Northern England. Even though we're on British soil, Menwith Hill is an American base operated by the National Security Agency. It's believed to be the largest spy station in the world.

KROFT: (Voiceover) Inside each globe are huge dishes which intercept and download satellite communications from around the world. The information is then sent on to NSA headquarters at Fort Meade, Maryland, where acres of supercomputers scan millions of transmissions word by word, looking for key phrases and, some say, specific voices that may be of major significance.

Mr. FROST: Everything is looked at. The entire take is looked at. And the computer sorts out what it is told to sort out, be it, say, by key words such as 'bomb' or 'terrorist' or 'blow up,' to telephone numbers or--or a person's name. And people are getting caught, and--and that's great.

(Footage of National Security Agency; Carlos the Jackal; two Libyans in court)

KROFT: (Voiceover) The National Security Agency won't talk about those successes or even confirm that a program called Echelon exists. But it's believed the international terrorist Carlos the Jackal was captured with the assistance of Echelon, and that it helped identify two Libyans the US believes blew up Pan-Am Flight 103.

Is it possible for people like you and I, innocent civilians, to be targeted by Echelon?

Mr. FROST: Not only possible, not only probable, but factual. While I was at CSE, a classic example: A lady had been to a school play the night before, and her son was in the school play and she thought he did a--a lousy job. Next morning, she was talking on the telephone to her friend, and she said to her friend something like this, 'Oh, Danny really bombed last night,' just like that. The computer spit that conversation out. The analyst that was looking at it was not too sure about what the conversation w--was referring to, so erring on the side of caution, he listed that lady and her phone number in the database as a possible terrorist.

KROFT: This is not urban legend you're talking about. This actually happened?

KROFT: (Voiceover) Back in the 1970s, the NSA was caught red-handed spying on anti-war protesters like Jane Fonda and Dr. Benjamin Spock, and it turns out they had been recording the conversations of civil rights leaders like Martin Luther King in the 1960s. When Congress found out, it drafted strict, new laws prohibiting the NSA from spying on Americans, but today, there's enough renewed concern about potential abuses that Congress is revisiting the issue.

Representative BOB BARR (Republican, Georgia): (From C-SPAN) One such project known as Project Echelon engages in the interception of literally millions of communications involving United States citizens.

(Footage of Barr; NSA sign; Goss and Kroft)

KROFT: (Voiceover) But even members of Congress have trouble getting information about Echelon. Last year, the NSA refused to provide internal memoranda on the program to Porter Goss, the chairman of the House Intelligence Committee.

What exactly was it that you requested?

Representative PORTER GOSS (Chairman, House Intelligence Committee): Well, I can't get too specific about it, but there was some information about procedures in how the NSA people would employ some safeguards, and I wanted to see all the correspondence on that to make sure that those safeguards were being completely honored. At that point, one of the counsels of the NSA said, 'Well, we don't think we need to share this information with the Oversight Committee.' And we said, 'Well, we're sorry about that. We do have the oversight, and you will share the information with us,' and they did.

(Footage of Goss and Kroft)

KROFT: (Voiceover) But only after Goss threatened to cut the NSA's budget. He still believes, though, that the NSA does not eavesdrop on innocent American citizens.

If the NSA has capabilities to screen enormous numbers of telephone calls, faxes, e-mails, whatnot, how do you filter out the American conversations, and how do you--how can you be sure that no one is listening to those conversations?

Rep. GOSS: We do have methods for that, and I am relatively sure that those procedures are working very well.

(Footage of Madsen; epic.org Web site; Amnesty International gathering; Greenpeace members in a boat; Princess Diana)

KROFT: (Voiceover) Others aren't so sure. Wayne Madsen works with a group called the Electronic Privacy Information Center, which is suing the NSA to get a copy of the documents that were finally turned over to Congressman Goss. Madsen, a former naval officer who used to work for the NSA, is concerned about reports that Echelon has listened in on groups like Amnesty International and Greenpeace. Last year, the NSA was forced to acknowledge that it had more than 1,000 pages of information on the late Princess Diana.

Mr. WAYNE MADSEN (Electronic Privacy Information Center): Princess Diana, in her campaign against land mines, of course, was completely at odds with US policy, so her activities were of tremendous interest to--to the US policy-makers, of course, and--and, therefore, to the National Security Agency eavesdroppers.

KROFT: Do you think the--the NSA only monitored her conversations that involved land mines?

Mr. MADSEN: Well, when NSA extends the big drift net out there, it's possible that they're picking up more than just her conversations concerning land mines. What they do with that intelligence, who knows?

(Footage of newspaper headlines; Menwith Hill Station)

KROFT: (Voiceover) In the early 1990s, some of Diana's personal conversations, as well as those of some others associated with the royal family, mysteriously appeared in the British tabloids. Could some of those conversations have been picked up by that US spy station in England?

Mr. MADSEN: (Voiceover) There's been some speculation that Menwith Hill may have been involved in the intercepts of those communications as--as well.

And how--how could that be legal? Well, British intelligence could say, 'Well, we didn't eavesdrop on members of the British royal family. These happened to be conducted by, you know, one of our strategic partners.' And, therefore, they would skirt the--skirt the British laws against intercepts of communications.

(Footage of National Security Agency sign)

KROFT: (Voiceover) The US admits it often shares intelligence with its allies, but never to get around the law.

Mr. FROST: Never, Steve, will governments admit that they can circumvent legislation by asking another country to do for them what they can't do for themselves. They will never admit that. But that sort of thing is so easy to do. It is so commonplace.

KROFT: Do you have any first-hand experience?

Mr. FROST: I do have first-hand experience where CSE did some dirty work for Margaret Thatcher when she was prime minister. She...

KROFT: What kind of dirty work?

Mr. FROST: Well, at the time, she had two ministers that she said, quote, "They weren't on side," unquote, and she wanted to find out, not what these ministers were saying, but what they were thinking. So my boss, as a matter of fact, went to McDonald House in London and did intercept traffic from these two ministers. The British Parliament now have total deniability. They didn't do anything. They know nothing about it. Of course they didn't do anything; we did it for them.

(Footage of Newsham and Kroft)

KROFT: (Voiceover) One of the few people to acknowledge that they have listened to conversations over the Echelon system is Margaret Newsham, who worked at Menwith Hill in England back in 1979. She had a top secret security clearance.

So who--you--you knew that conversations were being pulled off satellites.

Ms. MARGARET NEWSHAM: Yes. But to my knowledge, all it was going to be would be like Russian, Chinese or, y--you know, foreign.

(Footage of Newsham)

KROFT: (Voiceover) But soon, she says, she discovered it wasn't only the Russians and the Chinese who were the targets.

Ms. NEWSHAM: I walked into the office building and a friend said, 'Come over here and listen to--to this thing.' And--and he had headphones on, so I took the headphones and I listened to it, and--and I looked at him and I'm going, 'That's an American.' And he said, 'Well, yeah.'

KROFT: And it was definitely an American voice?

Ms. NEWSHAM: It was definitely an American voice, and it was a voice that was distinct. And I said, 'Well, who is that?' And he said it was Senator Strom Thurmond. And I go, 'What?'

KROFT: Do you think this kind of stuff goes on?

Mr. FROST: Oh, of course it goes on. Been going on for years. Of course it goes on.

KROFT: You mean the National Security Agency spying on politicians in...

Mr. FROST: Well, I--I...

KROFT: ...in the United States?

Mr. FROST: Sounds ludicrous, doesn't it? Sounds like the world of fiction. It's not; not the world of fiction. That's the way it works. I've been there. I was trained by you guys.

Rep. GOSS: Certainly possible that something like that could happen. The question is: What happened next?

KROFT: What do you mean?

Rep. GOSS: It is certainly possible that somebody overheard me in a conversation. I have just been in Europe. I have been talking to people on a telephone and elsewhere. So it's very possible somebody could have heard me. But the question is: What do they do about it? I mean, I cannot stop the dust in the ether; it's there. But what I can make sure is that it's not abused--the capability's not abused, and that's what we do.

KROFT: Much of what's known about the Echelon program comes not from enemies of the United States, but from its friends. Last year, the European Parliament, which meets here in Strasbourg, France, issued a report listing many of the Echelon's spy stations around the world and detailing their surveillance capabilities. The report says Echelon is not just being used to track spies and terrorists. It claims the United States is using it for corporate and industrial espionage as well, gathering sensitive information on European corporations, then turning it over to American competitors so they can gain an economic advantage.

(Footage of report; plane; report; Raytheon sign; Ford and Kroft)

KROFT: (Voiceover) The European Parliament report alleges that the NSA 'lifted all the faxes and phone calls' between the European aircraft manufacturer Airbus and Saudi Arabian Airlines, and that the information helped two American companies, Boeing and McDonnell Douglas, win a $ 6 billion contract. The report also alleges that the French company Thomson-CSF lost a $ 1.3 billion satellite deal to Raytheon the same way. Glen Ford is the member of the European Parliament who commissioned the report.

Mr. GLEN FORD (European Parliament Member): It's not the--if you want, the Echelon system that's the problem. It's how it's being used. Now, you know, if we're catching the bad guys, we're completely in favor of that, whether it's you catching the bad guys, us or anybody else. We don't like the bad guys. What we're concerned about is that some of the good guys in my constituency don't have jobs because US corporations got an inside track on--on some global deal.

(Footage of encryption machine; Clinton and several men walking; Ford)

KROFT: (Voiceover) Increasingly, European governments and corporations are turning to something called encryption, a system of scrambling phone, fax or e-mail transmissions so that the Echelon system won't be able to read them. The US is worried about the technology falling into the hands of terrorists or other enemies. The Clinton administration has been trying to persuade the Europeans to give law enforcement and intelligence agencies a key with which they can unlock the code in matters of national security. Glen Ford, the European parliamentarian, agrees it's a good idea, in principle.

Mr. FORD: However, if we are not assured that that is n--not going to be abused, then I'm afraid we may well take the view, 'Sorry, no.' In the United Kingdom, it's traditional for people to leave a key under the doormat if they want the neighbors to come in and--and do something in their house. Well, we're neighbors, and we're not going to leave the electronic key under the doormat if you're going to come in and steal the family silver.

KROFT: Y--you said that you think that this is basically a good idea, that we have to do this at some...

Mr. FROST: Oh, in a perfect world, we would not need the NSA, we would not need CSE. But, you know, we have to. We have to in the areas of terrorism, drug lords. We--we'd be lost without them. My concern is no accountability and nothing--no safety net in place for the innocent people that fall through the cracks. That's my concern.

KROFT: Accountability isn't the only issue that's of interest to Congress. There is growing concern within the intelligence community that encryption and the worldwide move to fiber-optic cables, which Echelon may not be able to penetrate, will erode the NSA's ability to gather the intelligence vital to national security. The agency is looking for more money to develop new technologies.

doesn't surprise me one bit. Just another reason to barely belive a word the "professional" reporters of the mass media. What a bunch of hacks. I don't like them doing it to american citizens, but if clinton did it PRE 9-11 and it was not an issue then i dont see how it can be an issue post 9-11. Bunch of traitors want to see america get nailed again.

If they really have this massive computer system "listening" to all of our emails and phone calls, maybe we should give it something to get excited about. Everyone should put a whole list of suspiscious phrases and words in their email signatures and send out tons of email with it. If enough were to go out, maybe it would crash their system. ;) Not that I would ever endorse circumventing ILLEGAL surveilance systems on foreign or domestic soil. ;)

There were media hollering about it, but at the time they were the "nutjob right wing wackos" Limbaugh, Mark Scott, etc. The left overlooked it cause it was on clintons watch so it was OK. Now since the pres is a republican the left is screaming.

In a way Im less afraid of this type of thing because of who is in office now. Im not so concerned that they will kick down my door cause I have a .22 rifle with a synthetic stock or a jeep with an ORV sticker on it in the driveway.

"In 1994, President Clinton expanded the use of warrantless searches to entirely domestic situations with no foreign intelligence value whatsoever. In a radio address promoting a crime-fighting bill, Mr. Clinton discussed a new policy to conduct warrantless searches in highly violent public housing projects. "